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Once upon a time, a real estate developer dreamed of building a planned community. The developer, Syd Kitson, envisioned a “city of tomorrow™” in southwestern Florida, designed for efficiency, convenience and harmony with nature.

Instead of driving cars everywhere, the 45,000 residents of Kitson’s Babcock Ranch would ride bikes to school, and walk to the cinema. They’d take a tram to visit friends in another hamlet, on the other side of a lush wildlife preserve.

The developers were making progress on this multi-billion dollar development—acquiring the 18,000-acre site and securing several important permits. But then the subprime-lending bubble burst, and the bottom fell out of Florida’s real estate market. One of Kitson’s primary financial backers—Morgan Stanley—teetered on the edge of collapse. And in November 2008 Fitch downgraded the ratings on Babcock Ranch’s debt.

Kitson insisted the development would proceed, but in December the company laid off half of the staff members dedicated to the Babcock Ranch project, saying the remaining team would focus on “short-term planning.”

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